IHS (IHS) Q4 2024 earnings summary

Executive summary

• FY24 financial results exceeded guidance, with revenue of $1,711M, adjusted EBITDA of $928M, and ALFCF of $304M, all ahead of expectations, and CapEx below guidance.

• Achieved 48% organic revenue growth, driven by 6.5% constant currency growth and FX resets, with Q4 organic growth at 9.2% year-over-year.

• Strategic review advanced: 72% of revenue renewed, major contract extensions, asset disposals in Kuwait and Peru, and governance enhancements implemented.

• Strengthened balance sheet via $1.2B refinancing, extended maturities, and improved liquidity to $914M.

• Nigeria's macroeconomic stabilization and telecom tariff increases supported improved outlook and operational momentum.

Financial highlights

• FY24 adjusted EBITDA reached $928M (54.3% margin), up 100 bps from 2023; Q4 margin at 56.3%.

• ALFCF for 2024 was $304M, ahead of guidance, with a cash conversion rate of 32.8%.

• Full-year CapEx was $256M, down 56% year-over-year; Q4 CapEx down 37%.

• Consolidated net leverage ratio reduced to 3.7x at year-end, down from 3.9x in Q3, aided by disposal proceeds and debt shift to local currency.

• Upstreamed $271M from Nigeria in 2024 due to improved FX availability.

Outlook and guidance

• 2025 guidance: revenue $1,680M–$1,710M (12% organic growth at midpoint), adjusted EBITDA $960M–$980M (4% growth), ALFCF $350M–$370M (18% growth), CapEx $260M–$290M.

• Guidance excludes Kuwait and Peru post-disposal and assumes moderate naira devaluation.

• Net leverage expected in the lower half of 3–4x range by year-end 2025.

• Working capital expected to be neutral to positive in 2025.

• Withholding tax in Nigeria reduced from 10% to 2% effective January 2025.